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REGIONAL NEWS - AFRICA 18 E&MJ; • MAY 2018 www.e-mj.com Asanko and Gold Fields Form JV Asanko Gold and Gold Fields Ltd. are forming a joint venture that will give each company a 50% stake in Asanko's 90% interest in the Asanko gold mine (AGM) in Ghana. The government of Ghana will continue to hold a free-carried 10% inter- est in the operation. The AGM is a multideposit mining complex, with two main deposits, Nkran and Esaase, and nine known satellite de- posits. Asanko will remain the manager and operator. A joint-venture manage- ment committee, comprising representa- tives from Asanko and Gold Fields, will be formed to oversee operations, with mate- rial decisions, including budgets and cap- ital expenditures, requiring unanimous approval. A technical subcommittee will be formed to provide technical advisory services to the management committee. Gold Fields will make an upfront payment of $165 million to Asanko on closing of the transaction and a deferred payment of $20 million. Asanko will use the proceeds primarily to repay its out- standing debt of $164 million owed to RK Mine Finance Trust I (Red Kite). In a separate transaction, Gold Fields has purchased a 9.9% equity interest in Asanko for a purchase price of $17.6 million. Gold Fields has two gold mines in Ghana — Tarkwa and Damang — located about 100 kilometers (km) south of the AGM. Tarkwa produced 566,000 ounces (oz) at all-in sustaining costs of $940/oz in 2017. Damang produced 144,000 oz at all-in sustaining costs of $1,027/oz. The AGM produced 205,000 oz of gold in 2017 and is forecast to produce 200,000 to 220,00 oz in 2018. Based on assumed completion of an ongoing expansion project, Asanko expects AGM production to average 253,000 oz/y for the five-year period from 2019 to 2023 at all-in sustaining costs of $860/oz. Mine life is forecast at a minimum of 15 years. The 540-km 2 land package held by Asanko remains relatively unexplored. "This transaction presents a unique opportunity for Asanko to de-risk its fu- ture production targets whilst at the same time eliminating corporate debt," said Asanko President and CEO Peter Breese. "With a healthy balance sheet and robust operational cash flows, together with a strong technical endorsement, our life-of- mine plan is assured. "The AGM is now operating well with- in our business targets, with mining effi- ciencies and the process plant delivering ahead of plan. With this new investment and the freeing up of our balance sheet, we will now move forward with the devel- opment of our large-scale Esaase deposit, with a view to commencing production in 2019, with an interim trucking operation until the 27-km overland conveyor to the processing plant is fully operational in late 2020. We look forward to working in partnership with Gold Fields and sharing mining and exploration expertise to create added value for all our stakeholders." Gold Fields CEO Nicholas Holland said, "West Africa is an important part of our business, and we look forward to a long partnership with Asanko in Ghana. We view the AGM as a high-quality asset and a great addition to our existing portfolio of open-pit gold operations in the country." Accident at Ahafo Mill Expansion Leaves 6 Dead A tragic accident occurred at Newmont Mining's Ahafo Mill Expansion project in Ghana on April 7. A contractor construc- tion crew of eight people was working inside a surface reclaim facility when the roof collapsed during the placement of concrete. Emergency response teams were deployed immediately, but six peo- ple lost their lives, and two people sus- tained minor injuries, the company said. Newmont Ghana immediately notified authorities and is cooperating with the police in their investigation. Newmont temporarily suspended production at its Ahafo and Akyem mines after the acci- dent, but since have restarted operations following extended safety discussions and risk assessments with employees. The Ahafo Mill Expansion project, where the accident took place, and all surface civ- il construction work will remain suspended until Newmont and the authorities are sat- isfied that work can resume safely. "On behalf of the entire Newmont fam- ily, I would like to express our deepest sor- row and extend our heartfelt condolences to the families, friends and co-workers of the victims," said Gary Goldberg, president and CEO. "Our priorities right now are to support the families of those who lost loved ones in this terrible accident, and to cooperate with authorities to investigate its causes." Katanga Provides Update on KCC Recapitalization Katanga Mining Ltd. was notified on April 20 that its joint venture partner, the Dem- ocratic Republic of Congo (DRC) state- owned La Générale des Carrières et des Mines (Gécamines), in the company's 75% DRC-operating subsidiary Kamoto Copper Co. (KCC), has commenced legal proceedings in DRC to dissolve KCC fol- lowing its failure to address its previously disclosed capital deficiency or, alternative- ly, if the court provides KCC with enough time to regularize the situation, to request the appointment of an expert to assess and report to the court on KCC's financial posi- tion and the recapitalization plan. A court hearing was scheduled to be held in the DRC on May 8. The court may grant KCC a maximum period of six months to regular- ize the situation. The company believes it has several options to remedy the capital deficiency and avoid KCC's dissolution. As disclosed in the company's annual information form for the year ended De- cember 31, 2017, under DRC corporate The Asanko gold mine in Ghana is expected to produce 253,000 oz/y starting in 2019. (Continued on p. 26)